Borrowers more confident with variable rates

The percentage of new borrowers choosing variable rate home loans rose in June for the third consecutive month as rate cuts hit home, according to the latest statistics by Mortgage Choice.

Borrowers have taken advantage of lenders’ recent rate cut offers by flocking to variable rate loans, with demand for this loan type rising by three percentage points to 82 per cent of all new home loan approvals last month. This is the highest level recorded in nine months.

Mortgage Choice spokesperson Belinda Williamson said the data shows borrowers are now more confident about taking out a variable rate mortgage. “Perhaps whispers of one more rate cut in coming months is wielding influence,” she said.

Source: The Adviser